Consumers less confident and ‘in fear’ of inflation

Posted 2008-02-2

UK consumer confidence is taking a beating thanks to worries about the rate of inflation, a report says.

The latest consumer barometer from Lloyds TSB shows the number of people expecting interest rates to be higher rather than lower a year’s time went up by two per cent last month.

This is the first rise in six months, and the financial services provider says inflation concerns are fostering a culture of worry among consumers.

Trevor Williams, chief economist with Lloyds TSB Corporate Markets, says even interest rate cuts may not help allay fears.

He said: “As far as consumers are concerned, any respite granted in interest rates today will be short-lived. Even so, if we do see a cut, this will ease the burden of interest payments and as such will help boost economic activity.”

Leave a Reply